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Housebuilder Redrow says the cost of building a house may rise by as much as 3-4% because of the growing pressures on supply chains following the resurgent housing market.

Redrow chief executive Steve Morgan, speaking after his firm reported pre-tax profits for the year to June 30 up 63%, said the increasing demand for materials and labour to construct homes was likely to lead through to construction cost inflation.

Redrow increased the number of completed sales by 15% in the year just gone, and Morgan said the firm would expand by 鈥渁t least鈥� that amount again in the current year.

Morgan said: 鈥淭he upturn seems to have caught the supply chain on the hop a bit. We think we鈥檙e not as badly affected as others because of the relationship we鈥檝e developed with our supply chain over many years. But there are issues with blocks and roof tiles. We鈥檙e hoping that鈥檚 short term and brick and block makers are stepping up production.

鈥淔or the first time we are seeing some build cost inflation. There are cost pressures but they鈥檙e manageable. It鈥檚 very hard to say what the impact will be on construction costs but my best guess is it would be in the region of 3-4%.

鈥淎t the moment we don鈥檛 know when the supply chain will get its act together.鈥�

Morgan added that Redrow鈥檚 expansion plans were also being hampered by delays in getting final approval for construction for sites through the planning system.

Redrow is one of a number of housebuilders to have flagged time and cost pressures in their supply chains in recent financial statements. The pressures have developed as housebuilders have scrambled to increase construction following improving sales rates in response to the government鈥檚 Help to Buy initiative, launched in George Osborne鈥檚 March Budget.

Stephen Stone, chief executive of Crest Nicholson, which announced a trading update demonstrating growing sales, said that the firm had resorted to importing 75% of its concrete blocks from Europe after its suppliers had been unable to meet demand. 鈥淭his is costing us about 拢300 in extra transport costs per house to get the blocks over, but it鈥檚 significantly cheaper than leaving half built houses until the UK producers can up their supply.鈥�

Stone added that lead in times for bricks and roof tiles had increased from six to 12 weeks and that he could forsee labour costs rising. However, he added that any increase in build costs was already being more than covered by increased in sales prices. 鈥淏uild inflation won鈥檛 be more than sales inflation,鈥� he said.

Galliford Try chief executive Greg Fitzgerald yesterday said there was 鈥渁 bit of panic鈥� in the industry around the supply of bricks and insulation blocks following the introduction of Help to Buy.